Consumer confidence slid in March as the Iran war and rising gas prices weighed on Americans’ views of the U.S. economy.
The University of Michigan’s preliminary March sentiment index, released Friday, showed consumer sentiment fell 5.8% from 56.6 points in February to 53.3 in March. That marks the lowest level since December 2025.
The drop in sentiment was more pronounced among middle and high-income consumers, Joanne Hsu, director of the Surveys of Consumers at the University of Michigan, said in a statement. Higher-income households have more wealth invested in the stock market, which has been highly volatile since the Iran war began on Feb. 28. The S&P 500 has slumped almost 6% since then.
Oil and gas prices have also climbed, putting financial strain on U.S. consumers, delivery drivers and farmers.
As of Friday, gas was $3.98, according to AAA, up $1 since the conflict in the Middle East erupted. Crude oil prices were also up, with Brent, the international benchmark, rising 1.8% to $103.72 per barrel and West Texas Intermediate (WTI), the U.S. benchmark, rising 3.04% to $97.35.
“Consumer sentiment pulled back in late March as households feel the heat from much higher gasoline prices, lower stock prices and spiking uncertainty,” said Oren Klachkin, financial market economist for Nationwide, in a statement.
The consumer sentiment data showed Americans’ inflation expectations also rose from 3.4% in February to 3.8% this month, the largest one-month increase since April 2025.
The survey data aligns with recent polling from CBS News, which showed that rising energy prices are fueling pessimism about the nation’s economy. Of the 3,335 U.S. adults polled, 85% said gas prices in their area have been going up. The vast majority, 90%, also said they expect U.S. gas and oil prices to be higher in the short term due to the war.